Market Insights - BC Waterfront Real Estate

Despite continued negative real estate reports in the media, we are starting to see increased interest in the BC waterfront real estate market again. While site traffic remained higher year over year, August-December 2008 were exceptionally slow in terms of the number of inquiries that went through the site; however,  in mid-January we saw a sudden increase in serious inquiries. This month, we are forecasting more unique visitors than we had last February (when the market was still hot). With interest rates at extreme lows (5 year mortgages available for 4.02) and average house prices starting to fall, it is beginning to make sense to jump into the market again.

While interest has picked up and I believe there is some pent up demand, the buyers out there know the market well and many are looking for deals. With forecasts calling for a hunkering down and a year or two more of these tough economic times, buyers who are ready to make the jump into some new real estate want a good price.

If you are a buyer, you can find some well-priced (under assessed value, foreclosures, etc...) waterfront properties in our "by searching the "Below Assessed Value" and "Motivated Seller" searches of our site.

If you are a seller and need to sell, make sure your house shows well and is priced aggressively. Also, you can review review Ozzie Jurock's article 10 Ways to Make Your Home Sell Faster by clicking here.

It seems like 2009 may be shaping up to be a year where deals start to pop up in the BC real estate market. We know a lot of you are out there looking for them, but we have been hearing that many buyers are scared to act now for fear that prices will fall further. Recent news that waterfront appraisals in some areas are down and sales are stalling combined with increased media hype about the poor economy will likely result in further price adjustments across BC in 2009. Depending on how long this "recession" continues, this could potentially be a great year for buyers to get in there and make some good buys on prime waterfront property.

All of the "bad" real estate news coming out right now is welcome news for buyers as it has made sellers more aware of the situation and as a result, homes are being priced much more competitively than in the past few years. I believe the days of multiple offers, $30, 000 over asking have come and gone; but they will most likely be back when we hit the next peak in the market.

Most BC property owners have already received their 2008 property assessments. Because property prices started to decline slightly after the 2008 assessments were completed, most properties will be taxed based on their lower 2007 assessment. The government has done this in part to avoid the unnecessary process of property owners appealing their assessments. Brian Hawkins, an assessor in Greater Victoria stated that higher-end and waterfront properties started to drop off in price earlier than some of the other types of property. He attributed this to their higher price escalation over the past 5 years.

To make things even better for buyers, some of the best-discounted 5-year mortgage rates that I have seen in a while showed up this week on Ozzie Jurock's Email notice. 5 year rates as low as 4.67 % are being offered by Meridian Canadian Mortgages.

We will be sending out a quarterly "Hot Properties" email with properties we believe represent good value in today's market, so if you're interested, sign- up below. Happy house hunting!

As I wrote a few weeks ago, the price drops are starting to show in the BC real  estate statistics. Landcor just released it's second quarter Residential Sales Summary and it shows median price changes of between 3.8 to 15.6% across the province. The biggest changes have happened in Northern BC, where prices are down over last quarter anywhere form 1.2 to 15.6%. Other areas of more notable changes include the Okanagan (1.9-8.7%) and the Kootenays (1 to 7%), while Greater Vancouver and Vancouver Island have remained relatively stable despite increasing inventory (no more than 3.8% price changes).

As I have mentioned since the beginning of this slowdown, Albertan interest seems to still be quite strong despite the slow markets in Calgary and Edmonton. I have kept a tally on our site visitors and the percentage of Albertans visiting the site has consistently remained high (20-25% of Canadians visiting the site). Albertans have made a comeback this quarter over last with a 36% increase in purchases. They favoured (in order) the Okanagan, the Kootenays and Vancouver Island and the majority bought (in order) condos, vacant land and detached homes. On the down side, buyers from the US and other Canadian provinces have slowed. 

Current market conditions should soon reflect lower sales prices as sellers who need to sell are taking lower offers and causing some markets to waver.  

Well, the headlines are out, the bears are saying "I told you so" and listing inventory is soaring. In his recent Facts by Email, Ozzie Jurock noted a very fussy buyer's market on the Sunshine Coast with some fabulous waterfront homes now available for under 1 million (for a different picture, click here for details on the waterfront market there last year).

Here in Courtenay, we have started to see price reductions and other areas of the province are experiencing the same thing. In Victoria, for example, according to the blog at www.cheaprealty.net, there is apparently a 20 month supply of properties over 1 million for sale right now and a recent Globe and Mail article suggested that Victoria's real estate is 30-35% over valued.

Negative headlines, over supply, higher interest rates, banks tightening up on lending...all of these factors have combined to mark the beginning of a downturn in B.C. real estate and although prices are already going down slightly, the stats have not yet revealed much of a change. I expect that shortly, the headlines will start to reflect price drops in many areas of BC. I don't expect them to tank rapidly, but rather edge down to a more affordable level slowly. After all, it is just another real estate cycle (albeit we had a longer and crazier upswing than normal) and prices are bound to drop a bit as the cyclical nature of the market returns.

So what does this mean for the B.C. recreational market? I have always maintained that the buyers are still out there. And why wouldn't they be? B.C. still has some of the most pristine and beautiful waterfront in the world, in a politically stable country with a very high standard of living. Moreover, internationally, B.C. waterfront still represents excellent value for many international buyers.

Throughout this slower real estate year our traffic has increased by at least 30% and there are still inquiries going through the site to our sellers and properties selling. Buyers are simply taking longer to make decisions and rightly so, given the market conditions. The days of multiple no subject offers are pretty much over and this, in my humble opinion, is a good thing. In fact, the best time to buy is often in a downturn when nobody is talking about real estate and an over supply of homes are languishing on the market. This is when the true investors and saavy buyers get in on the market. Then, assuming they can hold on until the next upswing, they can potentially make a small fortune when they sell!

So, as I have mentioned recently, if you are a seller, price your home competitively and make sure it shines above the competition. Then advertise, advertise, advertise. Try to make sure you get a plan from your real estate agent prior to listing detailing exactly what they will do to advertise your property. If you're a buyer then take your time because now you can find the property of your dreams without all the pressure.